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There’s Widespread Fear that the Suez Canal could Become the Target of Rushed Deals

Since its nationalisation in 1956 the Suez Canal has provided Egypt with a rich source of revenue as well as a sense of national pride – but could hard economic times mean that privatisation is now on the cards? Egypt’s economic difficulties are deeply rooted but have escalated since the onset of the coronavirus pandemic in 2020. The Suez Canal is the crown jewel of the Egyptian economy, bringing in a steady stream of income that has withstood wars, pandemics and financial crises. Some 10 to 12 percent of world trade and 10 percent of global oil and gas shipments pass through the 193.3-kilometer channel, generating daily revenues of $21.7 million. If the authorities in Cairo were to shut it down, the disruption to supply chains would trigger a massive inflationary surge. Given the strategic importance of the waterway, the creation of a fund allowing the sale of Suez Canal assets was met with a frosty reception from the Egyptian public and business sector. Selling some port facilities to private or foreign investors would take the country into the uncertain waters of free market economics. Egyptian President Abdel-Fattah El-Sisi is aware of this, but he has no other solution.